All bookings made by an Agency on behalf of their clients may either be done on a bill back or a referral basis.
Bill Backs
The principal will bill the client charges back to the agency who in turn must on-charge them to its client. The agency is liable to pay the principal (less com mission) and must collect the full charge from its client.
| Dr / C r | Account | Description |
| Dr | Client (Debtor) | Full charge from the principal |
| Cr | Commission Income | % of the principal charge |
| Cr | Output Vat | Vat on the commission income |
| Cr | Principal (Creditor) | Principal charge less commission and Vat |
Referrals
The principal will bill the charges directly to the client who is liable for payment. The agency thus incurs no liability and merely charges the principal for commission due on the booking amount.
| Dr / C r | Account | Description |
| Dr | Principal (Debtor) | Commission and Vat |
| Cr | Commission Income | % of the principal charge |
| Cr | Output Vat | Vat on the commission income |
Note that the principal becomes a debtor for commission
Air and Land Arrangements
As air tickets are normally routed via BSP the agency is automatically charged for any bill backs and automatically credited with commission due on any referrals with the total net monthly charges or credit automatically deducted or credited to the agency’s bank account on a monthly basis.
With land arrangements, the agency will receive separate invoices from each principal for bill backs and must manually record and pay each principal separately. It is however common for the agency not to receive a copy of the principal invoice in respect of referral bookings and the risk of not raising or collecting the commission due is high.
QuickTrav Vouchers addresses this risk by automatically maintaining an independent mini debtors ledger for referral commissions due from principals. For this reason alone, it is strongly recommended that you use the Voucher applications in conjunction with QuickTrav Invoicing.